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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Elwood P. Dowd who wrote (93160)	9/22/2001 10:44:03 PM
From: Night Writer	Respond to of 97611

EMC stock drops after warning, sparks wider tech fear (updates with closing prices) By Peter Henderson SAN FRANCISCO, Sept 21 (Reuters) - Shares of computer storage stocks dropped on Friday after industry leader EMC Corp.<EMC.N> warned it would cut jobs and probably report a loss this quarter, sparking wider fears for hardware firms. EMC stock dropped 12 percent, or $1.47, to $11.15, adding to losses earlier this week that have reduced its share value by about 20 percent since the beginning of the week. A year ago the stock was trading at all-time highs of about $104 per share. EMC had said it was highly unlikely it would break even in its third quarter and that it was cutting more than 2,000 jobs, or 10 percent of its global work force. Storage maker Network Appliance Inc.<NTAP.O>, which specializes in networked attached storage, a high-end storage system, also dropped 12 percent to $8.02. Analysts who lowered estimates for EMC cautioned that the effect of the weaker economy would be felt much wider. Hijackings that destroyed the World Trade Center last week have put to rest most hopes that the economy was on the road to recovery this year, although EMC did not comment on the attack. "We remain concerned that the very same deteriorating economic conditions are likely to preclude widespread storage area network buildouts," CSFB analyst Amit Chopra wrote in a note. He said he was concerned for storage switch makers Brocade Communications Systems, Inc.<BRCD.O>, whose stock lost 7.82 percent to $17.69, Emulex Corp.<EMLX.O>, down 10.27 percent to $10.31 and McData Corp.<MCDT.O>, off 11.08 percent to $9.87. The Dow Jones Industrial Average, by comparison, lost 1.68 percent to 8,235.81. "Key message: this is the first of many pre-announcements -- expect to reduce estimates for other computer and storage companies," Andrew Neff of Bear Stearns wrote in a research note, dropping his earnings per share target for EMC this year to 10 cents from 29 cents and revenue to $7.65 billion from $8.3 billion. International Business Machines Corp. <IBM.N>, Hewlett-Packard Co.<HWP.N>, Compaq Computer Corp.<CPQ.N>, Gateway Inc.<GTW.N> and Dell Computer Corp.<DELL.O> were all candidates for warnings, he wrote. IBM closed off $2.90 to $90.50, HP rose 46 cents to $14.96, Compaq, which intends to merge with HP, rose 14 cents to $7.99, Gateway was down 51 cents to $5.99 and Dell fell 85 cents to $16.63. ((Peter Henderson, San Francisco Bureau 415 677-2578 peter.henderson@reuters.com))